The Dean Corporation produces and sells a single product. The following data ref

Question

The Dean Corporation produces and sells a single product. The following data refer to the year just completed Beginning inventory Units produced Units sold Selling price per unit Selling and administrative expenses Variable per unit Fixed (total) Manufacturing costs Direct materials cost per unit Direct labor cost per unit Variable manufacturing overhead cost per unit $36 Fixed manufacturing overhead (total) 30,300 24,700 $ 465 25 $469,300 $ 211 $ 53 $454,500 Assume that direct labor is a variable cost. Required a. Compute the cost of a single unit of product under both the absorption costing and variable costing approaches. ost per un Absorption costi Variable costi b. Prepare an income statement for the year using absorption costing Absorption Costing Income Statemen 0 0 c. Prepare a contribution format income statement for the year using variable costing Variable Costing Income Statement Variable expenses: Fixed expenses

Explanation / Answer

a) Unit product cost :

2) Absorption costing income statement :

c) Variable cost income statement :

Absorption variable Direct material 211 211 Direct labour 53 53 Variable manufacturing overhead 36 36 Fixed manufacturing overhead 15 Unit product cost 315 300

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